Rates could rise if pegging is scrapped

COUNCIL will fight the state government on a recommendation that threatens to scrap the cap on local rate increases.

But the business community has called on council to go one step further and decrease rates to align with a significant drop in local land values.

A report by the Independent Local Government Review Panel has recommended council scrap "rate pegging" - a cap on how much rates can be increased each year - among 64 other proposals.

Council gave in-principal support to all of the other recommendations - including the controversial merge with Murrumbidgee Shire Council - but will hold firm on rate pegging.

If the constraint was to be removed, Councillor Simon Croce feared council could always justify increasing rates.

"Costs are always going to rise and there will always

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be things to spend money on, so without a harness we'll find something worthy to justify increases," Cr Croce said.

"Because there are some people who are doing well for themselves in Griffith, it's easy to forget our regular household income is slightly below the NSW average and there are a lot of battlers who earn wages.

"As an example, sewerage and water charges went up close to 6 per cent this year because they weren't capped and that's not to make a profit it was just to cover costs.

"It's also important to remember every rate rise compounds on the rise from the previous year, people pay enough as it is."

Local land values plummeted by $150 million between 2010 and 2013 according to a report by the NSW Valuer General in January, prompting speculation rates would come down.

Griffith Business Chamber president Pat Pittavino agreed rates should be dropped unless council made a more concerted effort to cut costs.

"All over the radio in Sydney, councils have been demonstrating they have been cutting back for four and five years before justifying rate rises," Mr Pittavino said.

"Council wanted to build a $4 million workshop for their mechanics and with a little bit of pressure from chamber it's already down to $2 million - I am convinced there are massive savings to be made if council ran efficiently.

"Chamber was abused for pointing out pool losses three years ago but council has known they've been losing around $800,000 per year.

"They're answer to their problems is to put the rates up, but the well is dry and they need to demonstrate efficiency savings."